Live-Blogging the NFIB Summit: The GOP's Fading Fortunes

6:50 PM It will not be a good year at the polls for Republicans, but it's too soon to say just how bad the election will go -- that's the view, anyway, of veteran politics watchers Charlie Cook and Stuart Rothenberg. John McCain may not a true Republican in the eyes of the people gathered in the Grand Hyatt's subterranean ballroom, but, said Cook, "It's only because John McCain's brand is so very different from the Republican brand that he has a 50-50 chance of winning the election."

(They seem to know their audience. Though an NFIB staffer told me that the organization's membership breaks evenly between Democrats and Republicans -- and Democratic primary turnout was higher among NFIB members than Republican turnout -- it was clear that the subset of people willing to make the trek to DC not only lean Republican, they tumble over. You could tell from the moments that generated applause or laughter.)

"He's running into a 40 or 50 mile-per-hour headwind," Cook added. "I'm not sure McCain gets credit for running as far ahead of the party as he is right now."

In Rothenberg's view, McCain won the nomination because former Arkansas governor Mike Huckabee drained conservative votes from former Massachusetts governor Mitt Romney. "John McCain had just enough oomph to squeak through."

Rothenberg loves right track/wrong track poll as a barometer of the political weather, and right now just 14 percent of Americans believe the country is on the right track. Three-quarters to four-fifths of the population believe the country is on the wrong track. He cited a New York Times that found that Democrats ranked favorably on all the major issues. The economy is a major issue, but McCain's "not very comfortable talking about the economy. You ask him about the economy, and somehow is answer ends up coming around to Al Qaeda and National Security.

"As the race starts now, I believe John McCain can win," he concluded. "But it's harder to imagine him winning than Barack Obama winning. I don't think you should delude yourself into thinking he's likely to win or it will be easy for him to win."

If McCain is, as Rothenberg put it, "swimming against a very strong current of change," then why does he have any chance at all of winning? The reason, both pundits agreed, is that the race will end up being about Obama. Cook conceded that Obama's rise took him be surprise. In all the key measures that define Democratic success -- support among people over 50, among people with less education, among people with smaller annual incomes--"advantage Clinton," said Cook. But he figured it out on the day after the Iowa caucuses, when he discovered that his relatively apolitical college-aged kids were "enthralled by Obama." The Illinois senator's popularity has an "aspirational aspect to it—a desire for a strong charismatic leader. That's what a lot of these Democrats see: a modern day, African American John and Bobby Kennedy. It's not issue- or ideologically driven." By contrast, the potential of a woman elected president didn't impress his 21-year-old daughter -- to her that notion never seemed inconceivable. "We have just jumped over gender and gone straight to race," said Cook.

Clearly, there is a disparity in enthusiasm that favors Obama. (The GOP, he said, quoting his sister, suffer from "electile dysfunction.") The question, in Cook's mind: "Is Obama too much change? Is he perceived as a risk, or is he seen as an acceptable level of change or risk?" He speculated that the Democrat "has a tougher time than Gore or Kerry in Florida and Ohio, and will have to work harder to keep Michigan and Pennsylvania." Meanwhile, the winner-take-all Electoral College makes things a little more difficult for the Democrats. "Obama might be a better popular vote candidate than Clinton, but she might have been a better electoral vote candidate."

Cook wasn't willing to make a prediction. "I don't know why this should suddenly become predictable. Because it sure as hell hasn't been predictable yet," he said. "I think this election is going to turn on events that have not yet occurred and dynamics that haven't taken shape." And, he added, "it's going to come to the wire."

And, said, Rothenberg, "no matter who wins, the environment will be more difficult for people in business."

There was no such equivocation about the future of Congress, however. "It's going to be somewhere between a good Democratic year and a big Democratic year," said Rothenberg. "There are just lots of Democratic opportunity." In the Senate, he predicts a gain of two to five seats, most likely in Virginia, Colorado, and New Mexico. "Virginia's gone, the other two are in serious trouble." New Hampshire Republican John Sununu is in "serious trouble." Republicans in Maine, Minnesota, Oregon, and even Alaska are at risk. "And the bad news—and this will give you indigestion—in 2010, Republicans will still be defending more seats than Democrats."

2:20 PM Apart from the eBay primer, the morning breakout sessions covered practical approaches to hot political issues. Up for discussion: "Coping with Immigration Crackdowns," Planning for Future Tax Increases," and "Stay Out of Court: 10 Ways A Small Business Owner Can Avoid Legal Trouble." I sat in on some of the legal issues, and listened as the conversation turned to having a harassment and discrimination policy. One man in the audience asked about a situation at his company, in which a female employee had complained several times about a male supervisor. "Should I fire him?" he asked the presenter, an NFIB attorney. From the front of the room came a man's voice: ""Fire her!" A teachable moment, which perhaps explains why many small business owners find themselves in court in the first place: that kind of retaliation is both illegal and an invitation for a lawsuit that would be richly deserved.

Lunch is over now, and political analysts Charlie Cook and Stuart Rothenberg tried to put the best face on what is likely to be a bad year for the Republicans. I'll digest their comments and report back to you later today.

10:54 AM Greetings from the bowels of the Grand Hyatt, not far from the White House, where some 750 small business men and women are gathered for the National Federation of Independent Business' 2008 National Small Business Summit. Over the next two days, the attendees will discuss the most important issues facing small firms, both among themselves and with our elected officials, and Inc.com will be there to follow the dialogue.

The morning started with a keynote from Meg Whitman, the ex-president and CEO of eBay.com, who asked, "Will the next century be the second American century? I think the answer is yes, but we have to band together to make sure that the government, at the federal and state level, move us in that direction." To that end, she pointed to the usual suspects as obstacles: 1) high corporate taxes, 2) "spiraling" health care costs, 3) a faltering education system, and 4) litigation costs and frivolous lawsuits. Surprisingly, Whitman's talk was not particularly well attended -- maybe half-full until the Q&A began.

Still, her presence was emblematic of two dominant themes pervading this conference. One is eBay, which provided two of the four introductory speakers (the other was Tod Cohen, vice president and deputy general counsel, government relations) and is the subject of one of the morning breakout sessions ("Elements of eBay Selling Success"). The other is John McCain. Whitman is one of the Republican nominee's chief big-deal corporate advisers. In fact, John McCain will be speaking to the organization tomorrow.

The NFIB has long been aligned with Republican policy priorities (for the record, Democratic candidate Barack Obama was invited to speak but declined), but this year's meeting promises a somewhat broader alliance. The first hint of that came after Meg Whitman finished and William D. Novelli, CEO of the American Association of Retired Persons took the podium. The AARP has joined NFIB in an organization called Divided We Fail, a coalition of business, labor and public interest groups seeking both health care and Social Security reform. (Divided We Fail came up in my health care Q&A last month with the NFIB's Bob Graboyes.) "A couple years ago, AARP and NFIB were on the opposite sides of the Enzi health care bill," said Novelli. But after AARP worked to defeat that legislation, he said, NFIB president Todd Stottlemyer took a different approach when he went back to the Hill. The result was bipartisan legislation introduced by Senators Dick Durbin (D-IL) and Olympia Snowe (R-ME). AARP would support that legislation, Novelli said (and work to improve it, of course). Of Divided We Fail, Novelli said, "Our mascot is part donkey and part elephant, and it's a lovely shade of purple."

I'll bring you updates from the NFIB summit today and tomorrow as events warrant and dodgy wireless signals permit. Next up: the breakout sessions. But despite my longstanding interest in eBay, I'm not likely to make it to that session.